There are many explanations for the current crisis,
but they all seem to share one thing in common. The view of most observers is
that this is a financial crisis, a crisis that originated in and was
amplified by the financial sector.

Of course, when theorists speak about a financial
crisis, they don’t speak of finance in isolation. They speak of finance in
relation to the so-called real capital stock. The current crisis, they argue,
happened not because of finance as such, but due to a “mismatch” between
financial and real capital. According to this view, the world of finance
deviated from and distorted the real world of accumulation; and since there is
no such thing as a free lunch, the ensuing crash is the price we all have to
pay for failing to prevent the distortion.

This mismatch thesis – the notion of a
reality distorted by finance – is broadly accepted. It is the basic premise of
liberals, it is endorsed by Marxists, and it guides policy makers.

There is only one problem. The mismatch itself does
not – and cannot – exist, and for the simplest of reasons: the very
distinction between “real” and “financial” capital is entirely fictitious. . . .

Conventional theories of capitalism are
mired in a deep crisis: after centuries of debate, they are still unable to
tell us what capital is. Liberals and Marxists both think of capital as an
“economic” entity, which they count in universal units of “utils” or “abstract
labour,” respectively. But these units are totally fictitious. Nobody has ever
been able to observe or measure them, and for a good reason: they don’t exist.
Since liberalism and Marxism depend on these non-existing units, their theories
hang in suspension. They cannot explain the process that matters the most – the
accumulation of capital.

This book offers a radical alternative.
According to the authors, capital is not a narrow economic entity, but a
symbolic quantification of power. It has little to do with utility or abstract
labour, and it extends far beyond machines and production lines. Capital, the
authors claim, represents the organized power of dominant capital groups to
reshape – or creorder – their society. Written in simple language,
accessible to lay readers and experts alike, the book develops a novel
political economy. It takes the reader through the history, assumptions and
limitations of mainstream economics and its associated theories of politics. It
examines the evolution of Marxist thinking on accumulation and the state. And
it articulates an innovative theory of “capital as power” and a new history of
the “capitalist mode of power.”

Jonathan
Nitzan teaches political economy at York University in Toronto.
Shimshon Bichler teaches political economy at colleges and
universities in Israel. Most of their publications, including the first
chapter
of Capital as Power, are freely
available fromThe Bichler & NitzanArchives.